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FREQUENTLYASKEDQUESTIONS

What is Medicaid?

Medicaid was established in 1965 to provide various types of assistance for low-income persons and the disabled. It is a joint federal and state program, with funding coming from both. The primary rules are determined by the Federal Government and the state may adapt them to some degree. There are many different types of eligibility and benefits, ranging from assistance to the aged, blind, disabled, medical care for children and chronically ill and newborns.

Medicaid is the program that pays for long-term care when a person needs to remain in a nursing home long term. If a person needs short-term rehabilitation in a nursing home, Medicare covers the cost for up to 20 days and even up to 100 if the person has a supplemental insurance policy.

While Medicaid has the connotation of providing services to the poor, most all families, except the very wealthy, need to eventually look to Medicaid to pay long-term nursing home costsbecause they are so high. Over two-thirds of the residents in a nursing home are receiving Medicaid benefits to help pay for the expenses. The quality of care is not affected by the manner of payment, whether it is Medicaid, private insurance, or private pay.

Who is eligible for Medicaid?

To be eligible to pay for nursing home care through Medicaid, you must be over sixty-five or disabled. In addition there are a number of financial eligibility criteria. For example, if you are a single person, your “countable assets” must be below $2,000.00 to qualify. For a married couple, the asset limitation is much higher and depends on the type and extent of your assets.

What does Medicaid cover?

Once a person is eligible, Medicaid coverage is very broad. Almost all necessary medical and dental services are covered. These include, physician services, inpatient and outpatient hospital services, nursing home costs, medical supplies, just to name a few. In addition, some non-medical services such as transportation expenses may even be covered.

How much property can I keep?

The rules for financial eligibility are complex and differ between a single applicant and married couple. Medicaid places limits on the type and amount of property a person can own and still receive Medicaid. First, the office determines if an asset is “countable” by verifying if the applicant “has the right authority or ability to liquidate the property.” Some assets like income-producing real estate, burial trusts or personal property are exempt and not counted.

The general asset limitation for a single person is $2,000.00 and $3,000.00 for a couple who are both in a nursing home. The asset rules are much different for a married couple where only one is in a nursing home. In that situation, certain assets like the marital home and care will be exempt. The non-exempt assets, like savings, CDs, IRAs (owned by the institutionalized person only), and the like, for both spouses are counted and the community spouse can keep one-half -- up to around $118,740.00. Medicaid requires that the rest is spent down to achieve eligibility. However, much of the additional assets can be preserved through various legal strategies.

How much income can I keep?

Once a single person is eligible for Medicaid and in a nursing home, Medicaid will require that all of that person’s income is paid to the nursing home each month to defray some of the costs, and Medicaid covers the rest. Each month the single person is allocated $52.00 of his or her income for personal expenses. This is called the personal-needs allowance.

The rules are much different for a married couple where one is in a nursing home and the other remains living in the community. Medicaid may allocate a portion of the income of the spouse in the nursing home in order to ensure that the minimum family income of $1,969.00 per month is met. This amount can be increased to about $2,931.00 if certain conditions are met.

Can I give my property away in order to qualify for Medicaid?

Medicaid law does not prohibit a person from giving away property to qualify for Medicaid. However, it does have some serious penalties that can limit the receipt of benefits. When a person applies for Medicaid, the caseworker will ask if there have been any transfers for less than fair market value in the five-year period prior to application. If so, then there may be a penalty period applied, which is a period of time in which Medicaid will not pay for long-term care. A number of factors including the amount of the gift, to whom it is given, and the date of the gift determine the extent of the penalty period. Effective legal counsel is important to know how past gifting may affect Medicaid nursing home coverage. Under the direction of an experienced Elder Law attorney, gifting assets can be an effective tool for preserving some of the assets.

What about the family residence?

In many cases the family residence can be protected from the cost of nursing home care. If one spouse is seeking Medicare coverage in a nursing home and the other spouse continues to live in the family home, that home is exempt from Medicare and will not be deemed a “countable asset”. In fact, the community spouse could even sell the home at a later point and retain all the proceeds without affecting continuing Medicaid coverage for the spouse in the nursing home. If a person is single and needs to vacate his or her residence, the alternatives are more limited. However, there are still strategies that can be used to preserve at least a good portion of the home’s value.

Must I repay Medicaid?

Medicaid law does have some “asset recovery” provisions and it is vital that applicants and their families know about such provisions prior to seeking Medicaid coverage. There are limitations, though: for example, Medicaid cannot seek recovery for benefits from the assets of that person’s spouse who has continued to live at home. Also, it may not seek to obtain a lien against a marital home if the community spouse or an adult disabled child continues to live there. Medicaid does have priority rights in a probate estate of a person who received Medicaid benefits. Attorney Stephanie Friel will carefully advise you and your loved ones about the potential pitfalls of Medicaid estate recovery.

I have long term care insurance. Can I still get Medicaid s and keep my assets?

Long-term care insurance is an effective tool for protecting assets from nursing home costs. While the premiums can be expensive, certain policies, approved by the Indiana Medicaid office, can provide full asset protection. In such cases, once the policy is fully exhausted, a person can receive Medicaid benefits without having to “spend down” their assets.

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Personalized and caring Will and Living Will preparation, Estate Planning, Trusts, Estates, Durable Power of Attorney, Health Care Directives, Guardianships, and Medicaid Planning

ROSSWURM ELDER LAW

PRACTICEAREAS

Representing clients in Fort Wayne and cities throughout northeast Indiana, including Auburn, Albion, Angola, Bluffton, Columbia City, Decatur, Huntington, Indianapolis, Kokomo, LaGrange, Muncie, Peru, Plymouth, Roanoke, Warsaw and additional communities in Allen County, DeKalb County, Steuben County, LaGrange County, Kosciusko County, Huntington County, Miami County, Howard County, Adams County, Wells County, Whitley County, Noble County, Marion County and Marshall County.

We offer a full range of services for your estate planning needs. We can assist individuals from simple to complex estate planning needs. We also offer planning for individuals who have special needs children or are currently receiving government assistance and need special estate planning to maintain their qualification for these benefits.

Wills

Oftentimes people have difficulties in making their estate plan because the fear it will be a difficult and stressful situation. Attorney Stephanie Friel focuses on making this experience as easy as possible while still providing you with educated estate planning techniques. Our office will focus on preparing only the documents you need, and not try to prepare expensive estate plans that serve little purpose to the client. This is why in most cases we generally recommend a simple Will for many of our clients instead of the more expensive Revocable Living Trust. Each case is unique so please contact us today to discuss which option is best for you.

Power of Attorney

Every good estate plan generally includes documents which designate other individuals to assist you in managing your financial and medical affairs. A power of attorney allows you to appoint someone to manage your financial and real estate matters while still putting limitations on their authority to act. Indiana law does not designate anyone to act on your behalf if you are unable to manage your financial affair. Without a power of attorney, your loved ones may not be able to take actions to protect your assets or to act in your best interests without having a guardianship established by an Indiana Court through potentially highly contested and expensive litigation. A power of attorney allows your loved ones to assist you in managing your assets without having to pay for an expensive guardianship proceeding.

Health Care Representative

In a difficult situation, it is not uncommon for families to have disagreements as to the proper care for their loved ones. With the proper health care forms, you can nominate an individual responsible for making these decisions and also give them guidance as to your wishes should they be faced with a difficult decision concerning your health. In contrast to your financial affairs, the Indiana legislature has enacted a law which establishes a list of individuals who can serve as your health care representative. Unfortunately this law fails to prioritize which individual can make this decision. Thus, in a situation where competing interests are present it may be unclear who will make health care decisions on your behalf. A health care representative form allows you to prioritize the individuals to make these decisions and to provide them with the guidance as to how you wish for them to act on your behalf.

Trusts & Special Needs Trusts

Our office has the expertise and ability to draft several different types of trusts while giving our clients the proper guidance as to the steps they need to take to properly fund and administer the trust. This enables us to provide our clients with a complete understanding of the actions they should take in order to provide their loved ones with both the inheritance they have planned for them as well as the assistance provided from various public agencies.

Third Party Special Needs: Many families today are struggling with the difficult scenario of establishing an estate plan that provides for their loved ones. This process can become more confusing when one of your loved ones is receiving Medicaid or other public benefits. By establishing a third party special needs trust as part of the client's estate plan, we allow him or her to provide an inheritance for the future needs of the child while also allowing the continuance of Medicaid benefits. Our office has the expertise and ability to draft these trusts while also giving our clients the proper guidance as to the steps they need to take to properly fund and administer the trust.

Self-Settled Special Needs Trusts: A self-settled special needs trust is one established by an individual for his or her own personal benefit. Generally, this individual is a Medicaid beneficiary who has either received an inheritance, settlement, or other funds which would result in benefits being terminated if these funds are not placed into a special needs trust for his or her own benefit. These trusts are established pursuant to Federal Law and are commonly referred to as d(4)(a) or self-settled special needs trusts. Since the Medicaid recipient is creating this trust, a provision is inserted into the trust which requires repayment for any Medicaid funds expended on behalf of the beneficiary upon his or her passing. The funds placed in these trusts are restricted as to how they can be spent, but the establishment of the trust ensures that the individual does not lose Medicaid benefits. Since many beneficiaries wait years to be placed on a Medicaid waiver, the establishment of the trust is a much better option than simply forfeiting the Medicaid benefits. Additionally, these funds can often be spent on lots of different resources that significantly improve the quality of life for the individual while still allowing him or her to receive medical care through Medicaid services. Each individual's scenario is unique, and our office will review the client’s situation to determine whether a Special Needs Trust should be established or whether a different alternative is available to the client.

Guardianships

Attorney Stephanie Friel assists individuals attempting to establish a guardianship over a friend or loved one. We have experience in dealing with the Courts to address concerns about guardianships over minor and incapacitated adults. We also offer assistance to guardians in managing their duties to both the protected person and the court system.